Economics and Politics

December 20, 2008

A wrong choice for Obama to be a major figure in his inauguration, but also wrong in general.

I know that Obama’s big deal is supposedly inclusiveness – to include all in his cabinet and the decision making, even those who may disagree with him. Well OK, including some people who may disagree with you, and who won’t be afraid to stand up to you, can be a good thing. We could have done with some of that over the past eight years. But having someone who disagrees with you is one thing. It is OK to disagree at times. What is not OK is to include someone who is just plain wrong.

Warren is wrong on so many things. Many people have pointed out that he is wrong on Proposition 8, and everything to do with the treatment of gay people. But then Obama has also said he’s against gay people being allowed to marry, so perhaps Obama agrees with Warren on this topic, on some level at least. So it’s not this thing that surprises me so much about this pick. It disappoints me considerably, but it doesn’t totally surprise me. What I do find incomprehensible though, for a President-Elect who has promised to reinstate the importance of science in his administration, is that he will give so much prominence to an evolution denier.

If you're asking me do I believe in evolution, the answer is no, I don't. I believe that God, at a moment, created man. I do believe Genesis is literal, but I do also know metaphorical terms are used. Did God come down and blow in man's nose? If you believe in God, you don't have a problem accepting miracles. So if God wants to do it that way, it's fine with me.

Warren’s ignorance of science most likely informs his other positions on gay rights, stem cell research and women's rights. Such a man should not have any place in Obama’s inauguration. Inclusiveness is OK, wrong is just wrong at any time.

August 15, 2006

THE [UK] Government is discussing with airport operators plans to introduce a screening system that allows security staff to focus on those passengers who pose the greatest risk.

The passenger-profiling technique involves selecting people who are behaving suspiciously, have an unusual travel pattern or, most controversially, have a certain ethnic or religious background.

The system would be much more sophisticated than simply picking out young men of Asian appearance. But it would cause outrage in the Muslim community because its members would be far more likely to be selected for extra checks.

Seems to make sense to me – check in more detail the people who appear to be the higher risk. And who could argue most potential bombers aren’t Muslims?

There is a contrary position:

Three days before last week’s arrests, the highest-ranking Muslim police officer in Britain gave warning that profiling techniques based on physical appearance were already causing anger and mistrust among young Muslims. Tarique Ghaffur, an assistant commissioner of the Metropolitan Police, said: “We must think long and hard about the causal factors of anger and resentment.

That may be true, but in my opinion, limited resources should be focused on where the problem is more likely to lie. However, simply choosing people based on physical appearance would be problematic because appearance is relatively easy to change. Plus, not all Muslims are of the same stereotypical appearance. But that doesn’t appear to be what they are proposing:

Sir Rod Eddington, former chief executive of British Airways, criticised the random nature of security searches. He said that it was irrational to subject a 75-year-old grandmother to the same checks as a 25-year-old man who had just paid for his ticket with cash.

Philip Baum, an aviation security consultant, said that profiling should focus on ruling out people who obviously posed no risk rather than picking out Asian or Arabs.

Precisely. Subjecting everyone to the same level of security, the same probability of a detailed search, is idiocy in the name of political correctness. But would this new policy cause anger and mistrust among young Muslims in excess of any benefits obtained? Please discuss.

August 06, 2006

The Two
Percent Company have an article today eloquently exposing the lunacy of the
war on drugs. Here we have a sting
operation where the owners of convenience stores are being prosecuted for
selling cold medicine, cooking fuel, and (get this) matchbooks – to undercover police officers - because these items
can be used to make crystal meth. And
the penalties could include up to 20 years in prison, forfeiture of their
stores, fines of up to $250,000, and, in some cases, deportation.

Makes you feel good to know your tax dollars are
being spent so wisely.

June 01, 2006

I noticed that PZ Myers has already commented on this story in Wired about how the Feds are cracking down on people with home chemistry sets and the like. Apparently there is a danger that kids might hurt themselves with chemicals; also terrorists might get hold of them. But another reason to ban people from owning chemistry glassware is that they might make crystal meth with it.

PZ has already gone into how this discourages kids from getting involved with science – read his post and the wired article for more details. I just had to comment on how the useless paranoid war on drugs has once again interfered with the lives of otherwise law abiding people. First, do they really think this will stop people making meth? I’m sure determined cooks will find a way round this somehow. Secondly, the crackdown on availability of the precursors has already pushed most meth production to Mexico anyway:

This deadly drug is now a growth industry for Mexico's deadly drug cartels. They're replacing small U.S. kitchen labs with Mexican super labs. The cartels are smuggling ephedrine from China, India and Europe and cooking up huge quantities of cheap meth — including an especially potent variety, Mexican Ice. Then the cartels smuggle it north to U.S. users.

"They're making quite a lot of money off of meth," Gonzalez said. "They are pretty much using the same routes that they've used in the past with cocaine and with marijuana."

By some estimates, as much at 80 percent of the meth on U.S. streets comes from Mexico.

The war on drugs has been successful only in promoting the outsourcing of drug production. The resultant cost reductions have promoted increased drug use. Behold, the market in action.

November 23, 2005

It seems the local government in San Francisco is determined to drive as much business away from the city as possible. Legislation was introduced Tuesday by Supervisor Tom Ammiano to require all San Francisco businesses with 20 or more workers to pay for health care insurance:

The ordinance, submitted by Supervisor Tom Ammiano, would force businesses not offering medical coverage to their workers to set up health savings accounts and pay $345 a month per employee into them. Businesses would use the savings to buy health insurance for their workforce.

The $345 is what it costs the city government per month to cover each of its workers.

Under the legislation, a task force would be created to examine whether companies that say they can't afford the $345 a month should be allowed to pay a lower, unspecified fee directly to the city -- and the city would provide coverage or direct medical care.

Great. Just what businesses in the city need: another set of government forms to complete and another government audit to comply with, to determine if they can afford this new tax for doing business in SF.

Some people who actually know about running businesses think this may be a bad idea:

"Supervisor Ammiano calls his coverage 'universal,' but the only thing universal about the Worker Health Care Security Act is the universal damage it will do to San Francisco's economy," said Mike Flynn, director of legislative affairs for the Employment Policies Institute in Washington, D.C.

"Expanding insurance coverage is a laudable goal," Flynn added, "but you can't wave a wand and do it by legislative command. His proposal would slap San Francisco's businesses with staggering costs and lead to tremendous job loss among the city's least-skilled workers."

Nathan Nayman, the director of San Francisco's Committee on Jobs, a lobbying group for downtown business interests, echoed the point. "This is going to have a negative consequence on business in the city. There's just no doubt about it," Nayman said.

…

Jot Condie of the California Restaurant Association... said restaurants and other small businesses typically operate at small profit margins. If Ammiano's legislation passes, it would likely drive them out of town, he said. "The fact that it's a city proposal, the notion of flight from San Francisco and its tax base really is a relevant point."

Ammiano doesn't agree:

Businesses that offer health care for their workers have higher productivity, he said, and do better in the marketplace.

October 17, 2005

The ex-police chief of Seattle, drawing on many years of experience as a police officer, has come to the conclusion that all drugs should be legalized. You really need to read the entire article, but you could start with:

Prohibition of alcohol fell flat on its face. The prohibition of other drugs rests on an equally wobbly foundation. Not until we choose to frame responsible drug use — not an oxymoron in my dictionary — as a civil liberty will we be able to recognize the abuse of drugs, including alcohol, for what it is: a medical, not a criminal, matter.
As a cop, I bore witness to the multiple lunacies of the "war on drugs." Lasting far longer than any other of our national conflicts, the drug war has been prosecuted with equal vigor by Republican and Democratic administrations, with one president after another — Nixon, Ford, Carter, Reagan, Bush, Clinton, Bush — delivering sanctimonious sermons, squandering vast sums of taxpayer money and cheerleading law enforcers from the safety of the sidelines.
It's not a stretch to conclude that our draconian approach to drug use is the most injurious domestic policy since slavery. Want to cut back on prison overcrowding and save a bundle on the construction of new facilities? Open the doors, let the nonviolent drug offenders go. The huge increases in federal and state prison populations during the 1980s and '90s (from 139 per 100,000 residents in 1980 to 482 per 100,000 in 2003) were mainly for drug convictions. In 1980, 580,900 Americans were arrested on drug charges. By 2003, that figure had ballooned to 1,678,200. We're making more arrests for drug offenses than for murder, manslaughter, forcible rape and aggravated assault combined. Feel safer?

I've witnessed the devastating effects of open-air drug markets in residential neighborhoods: children recruited as runners, mules and lookouts; drug dealers and innocent citizens shot dead in firefights between rival traffickers bent on protecting or expanding their markets; dedicated narcotics officers tortured and killed in the line of duty; prisons filled with nonviolent drug offenders; and drug-related foreign policies that foster political instability, wreak health and environmental disasters, and make life even tougher for indigenous subsistence farmers in places such as Latin America and Afghanistan. All because we like our drugs — and can't have them without breaking the law.

Although small in numbers of offenders, there isn't a major police force — the Los Angeles Police Department included — that has escaped the problem: cops, sworn to uphold the law, seizing and converting drugs to their own use, planting dope on suspects, robbing and extorting pushers, taking up dealing themselves, intimidating or murdering witnesses.

A devastating indictment of current policy. He concludes with an outline plan of how legalization would work:

Regulation of manufacture

No advertising

Taxed

No selling drugs to minors

Driving under the influence still a serious crime

I pretty much agree with everything he says. I don’t have a lot to add except that of course, it’s not going to happen: no politician would risk supporting a proposal that opposes the current dogma. I have to hope articles like this may eventually help move us towards a more rational approach.

March 09, 2005

This is from an editorial in the San Francisco Bay Guardian, representing a view supported by the San Francisco Tenants Union. It supports proposed new legislation that would require:

that someone own a building for five years before he or she can … go out of the business of being a landlord.

In San Francisco, the Ellis Act is generally used by real estate speculators to evict all the renters in a building so that it can be sold to individual buyers as a tenancy in common. In the case of two- and three-unit buildings, for instance, that means two or three people jointly owning a property that each can then occupy a unit in. Later the buyers enter the condo-conversion lottery in order to become owners of their units.

I’ll translate that for those not familiar with the surreal, upside-down economics of San Francisco. This is a government run lottery for property owners. The prize is to be allowed to live in your own property and / or be able to sell it if you want, and not have to rent it out under rent-control. You read that correctly: some property owners in San Francisco have to enter a lottery to see if they are allowed to stop renting out their property to rent-control tenants. And they wonder why rents are high in San Francisco. Jeez, you’d think people would be lining up to buy properties to rent out at rents decided by the government for as long as the government decides you should do so.

And the paper knows who the bad guys are: it’s the “greedy individuals (who) are also gentrifying neighborhoods and destroying race and class diversity”. Wow. So running any kind of property business, or just wanting a home of your own, is “greedy”. Thanks for clearing that up.

And it also knows who the victims are: it’s the “displaced tenants – in many instances seniors, people of color, people with AIDS, or working-class folks – (who) have to shuffle for a new place in a market where the rents are still immorally high.” Of course – renters should have the same rights and privileges as property owners, but without all the pesky inconvenience of actually buying a property. (You know, finding the property, finding the money for the down-payment, qualifying for the loan, investing the time, paying the legal fees, buying the property, paying the property taxes, paying to insure and maintain the building, and taking the risks.) But, of course, they still shouldn’t have to pay those “immorally high” rents.

Property is expensive in San Francisco, and life is difficult for lower income people, seniors etc. But why is it the job of a small group of people – private property owners – to solve this problem out of their own pockets? Here’s an idea. Allow property owners to do what they want with their properties – rent them out or live in them, or leave them empty, whatever. Then abolish rent control so that more property owners are likely to want to rent their properties out. Standard economic theory would indicate that rents would then come down to something less “immoral”.

Ha! It’ll never happen. Alice in wonderland is alive in this city – black is white, up is down and the laws of supply and demand can be repealed just because the City government says so.

February 18, 2005

The Economist reports (subscription may be needed), of a forthcoming article in the American Economic Review, entitled“Why Have Housing Prices Gone Up?” A conclusion is that a large portion of the increase in property prices is due to government restrictions on building new property. It’s basic economics: restrict supply and, all other things being equal, prices go up. The article states that by the year 2000, the value of what they call “permission to build” was more than 40% of the price of property in 27 US cities.

As they point out, this is significant because:

Since housing is by far the biggest expense for most people, any source of house-price inflation matters. Although zoning restrictions are often welcomed on the grounds of preserving the benefits of rural charm or urban character, their cost tends to fall disproportionately on poorer people.... By raising property values, planning laws act as a windfall for existing owners and a burden on those who rent or seek to buy. Since renters typically have lower incomes and wealth, zoning is often a highly regressive form of taxation

(My bold.)

This is especially significant for residents of San Francisco where I live. Property prices are high here. But at least the lower income renters in SF are protected by rent control laws, so their rents are held down, right? No wait, rent control increases rents. Guess they’re screwed then.

The city government in SF restricts new building on the principle that if less property is built, fewer people will want to move here. Then they restrict the rents landlords can charge and assume this will result in low rental property becoming available. Yes, the city government thinks it can repeal the laws of supply and demand. Good job I bought my property in 1998.